Reducing costs remains amongst the top reasons why organizations use public cloud services. However, when calculating the costs of public cloud services organizations need to look well beyond the license fees and billed costs.

With Cisco Cloud Consumption Services, we have worked with numerous customers to discover their public cloud usage and analyze cloud spend. At Cisco Live Milan, taking place January 26-30, we are sharing public cloud spending trends with our customers. We have found that the hidden or soft costs of public cloud services can be four to eight times higher than visible costs. These soft costs fall in three areas and include business risk, network and security costs, as well as cloud operations and integration.

Cloud computing has been an important aspect of IT departments for several years but it wasn’t until the past decade that cloud computing started to develop and evolve to include private, public and hybrid cloud solutions. The capability and agility of the cloud has forced this rapid evolution. Cloud is transforming businesses of all sizes, from small and midsized businesses to larger organizations – a trend that’s showing no signs of slowing down. So what does the evolution of cloud solutions and services mean for the future?

The Future is Cloud

Cloud enables capabilities such as enhanced remote access, video streaming, faster disaster recovery, increased scalability and reduced IT infrastructure total cost of ownership (TCO) and will be a main driver of these capabilities moving forward.

With most new software being built for cloud from the outset, Gartner predicts that Read More »

Much like the MPG argument when comparing diesel engines versus regular gas engines, and hybrid gas/electric versus pure plug-in electric vehicles, similarly valid arguments can be made for any combination of IT strategies: the traditional on-premise data center and private clouds, versus IT out-sourced. What IT strategy you chose will no doubt come down to what your mission is and how IT can best support business growth, outcomes, etc.

We’re seeing increasingly more interest a combination of traditional and out-sourced IT models: a well-balanced hybrid IT strategy.

Ideally, this hybrid IT environment is one where you maintain control, security, and data sovereignty as offered by private clouds, while achieving the speed, agility, and scale at a price point offered by the provider clouds, right?

Lunch Is On Us

To help you make informed decisions on how you can build such a highly secure hybrid cloud strategy and extend your existing data centers to public clouds as needed, on demand, with consistent network and security policies – we’re coming to 16 locations in the USA to tell you about it.

If you are like the many IT managers we talk to every day, you prefer to have options whenever you tackle a project or formulate your IT strategy. Perhaps, you do not like the idea of feeling limited, constrained or unable to leverage a viable contingency plan. Architecting your cloud strategy should be no exception …. And Cisco Intercloud Fabric can help!

So what does Cisco Intercloud Fabric do?

No time to read? This short video will provide you with an overview of the solution and perhaps entertain you for a couple of minutes. And if you are at VMworld this week, you can stop by at the Cisco booth to learn more about Cisco Intercloud Fabric.

In essence, Cisco Intercloud Fabric provides open and highly secure portability of workloads (aka applications) among heterogeneous cloud environments and with consistent network and security policies. You can move your workloads from your traditional IT environment or your private cloud to a public cloud provider of your choice. We have discussed in the past how hybrid cloud is becoming the ‘new normal’. Cisco Intercloud Fabric lets you deploy a hybrid cloud that operates as one unified environment—straddling your data center boundaries—with you in control.

And what are the benefits?

Choice – Can you really put in place a sound strategy if you do not have options, if you do not have choice? Are you limited in your choice of hypervisors, public cloud providers, or IT infrastructure? How easy is it to change cloud providers if you wanted to do so in the future? Cisco Intercloud Fabric will give you the freedom to place workloads across clouds. And across heterogeneous environments … ‘any’ network … ‘any’ hardware platform … with multi-hypervisor support … from VMware vSphere to Microsoft Azure … and …. back!

Consistency – Can you seamlessly extend your private cloud environment to the public cloud? What about your network and security policies? How will they change? Cisco Intercloud Fabric will make your life easier in this regard. You will be able to get consistent network and security policies across your data and applications, wherever they reside. This will allow you can accelerate the time required to deploy your applications to the cloud.

Control – Managing multiple cloud frameworks is challenging! More importantly, it is about selecting the best cloud for your specific application and data. Cisco Intercloud Fabric gives you unified workload management across clouds ….. You are back in control!

Cisco Intercloud Fabric is a powerful enabler to facilitate that transition. You, like most IT decision makers want to retain control over your hybrid cloud environment and you may need the ability to repatriate your workloads back to your data centers. Avoid a ‘one-way’ trip to the public cloud …. Retain choice, consistency and control without compromising your compliance requirements with Cisco Intercloud Fabric!

Do you want to see a demo?

Well … If you are going to be at VMworld in San Francisco this week, you can stop by at the Cisco booth (#1217.) You will be able to witness how you can unleash your hybrid cloud with Intercloud Fabric. You can also attend one of our sessions on Tuesday to learn more about this solution and associated use cases.

Recently, I had the opportunity to join a discussion regarding the #FutureOfCloud in the #InnovateThinkTweet Chat. One of the questions that came up revolved around the process typically used to associate a workload with a specific cloud deployment model. That is an important question and top of mind whenever we speak with customers.

One of the most appealing qualities of the cloud is the variety of ways in which it can be delivered and consumed. A successful cloud strategy will let you take advantage of a full range of consumption models for cloud services to meet your specific business needs. In reality, when we think about it, the process is very similar to what any company in virtually any industry goes through when shaping its business strategy. For each area of the business, inevitably the question arises: Build, Buy or Partner?

Build versus Buy

When formulating their sourcing strategies, IT organizations repeatedly face very similar service-by-service, “build-versus-buy” decisions. The predisposition of IT organizations is to create and build IT services on their own. That is what many IT professionals want to do … create new services, invent ‘new things’. And that may very well be the best option. However, many customers also realize that it is often beneficial to adopt best-in-class capabilities to remain competitive even if this requires outsourcing select portions of the IT value chain. Hence the emerging role of IT as a broker of IT services that we discussed in the past (for more information please visit our web site.) And this requires a paradigm shift for many IT organizations.

Solving the ‘Equation’

To solve the “build versus buy” equation when sourcing their IT services, IT needs to evaluate cost, risk, and agility requirements to determine the best strategy for their business. IT needs a plan and a set of governance principles to evaluate each service based on its strategic profile. A collaborative approach between business and IT is also required. For example: Is the service core to the business? What is the business value associated with it (e.g., strategic importance, sustainable differentiation it can provide, time to market requirements etc..)? What are the cost implications (CapEx vs OpEx), risk profile, security, SLAs, data privacy and regulatory compliance requirements? And … do you have the expertise to plan, build and manage the new IT service while meeting the expectations of your business counterparts?

Hybrid Cloud Rapidly Emerging as the New ‘Normal’

Not surprisingly, my experience when talking to customers that operate in regulated industries or that are concerned about security – and the privacy of their data more specifically – is that they tend to favor private cloud deployments. For example, I was talking to a compliance manager part of a global financial institution and as soon as I uttered ‘public cloud’ his reaction was quite predictable …. He shook his head, got serious and quipped “Public cloud … I do not think so …” Real or perceived, security concerns remain top of mind and a major barrier to cloud adoption, and this is validated by market research data.

The predictability of the application with respect to resource consumption is also a factor. Applications that have high elasticity requirements are well positioned to benefit from the economics, agility and scale that public clouds can offer. Infrastructure capacity planning and optimization is a big task for most IT organizations. Having the ability to burst into the public cloud represents an appealing option. This is also why ultimately hybrid cloud is becoming the new normal, and results of the 2014 North Bridge Future of Cloud Computing Survey supports that view.

2014 Future of Cloud Computing – Annual Survey Results

The Power of Choice

Arguably the most important thing your IT organization can do is to diversify its choice of cloud providers ….. Simply because without choice you really do not have a strategy …. And no contingency plans to go along with it ….

What do you think?

Additional Resources:

If you want to learn more about Cisco Cloud you can watch this video or visit our web site

If you need help with your cloud strategy, please consider the Cisco Domain Ten framework

Some of the individuals posting to this site, including the moderators, work for Cisco Systems. Opinions expressed here and in any corresponding comments are the personal opinions of the original authors, not of Cisco. The content is provided for informational purposes only and is not meant to be an endorsement or representation by Cisco or any other party. This site is available to the public. No information you consider confidential should be posted to this site. By posting you agree to be solely responsible for the content of all information you contribute, link to, or otherwise upload to the Website and release Cisco from any liability related to your use of the Website. You also grant to Cisco a worldwide, perpetual, irrevocable, royalty-free and fully-paid, transferable (including rights to sublicense) right to exercise all copyright, publicity, and moral rights with respect to any original content you provide. The comments are moderated. Comments will appear as soon as they are approved by the moderator.